What is a cooperative?
What is cooperation?
Cooperation is a concept that was probably developed in pre-historic times. Whenever people associate for mutual benefit, we have cooperation. Many examples of cooperation have been used throughout history.
What is a cooperative
A cooperative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically-controlled enterprise.
A cooperative is thus an organization that is owned and controlled by the people who use its products, supplies and/or services. Cooperatives can vary in their purpose but share in common the fact that they are formed to meet the specific objectives of members and adapt to member’s changing needs. Self-reliance and self-help are the hallmark of cooperatives. Profits generated are either reinvested in the enterprise or returned to the members. Cooperatives bring people together in a democratic and equal way.
Cooperatives are businesses owned and run by and for their members. Whether the members are the customers, employees or residents they have an equal say in what the business does and a share in the profits. Cooperatives are democratically managed by the 'one member, one vote' rule. Members share equal voting rights regardless of the amount of capital they put into the enterprise. They allow people to take control of their economic future and, because they are not owned by shareholders, the economic and social benefits of their activity stay in the communities where they are established.
As businesses driven by values not just profit, cooperatives share internationally agreed principles and act together to build a better world through cooperation. Putting fairness and equality at the heart of the enterprise, cooperatives around the world are allowing people to work together to create sustainable enterprises that generate long-term jobs and prosperity.
The cooperative as a form of business organization began during the Industrial Revolution. Cooperatives promoted the interests of the less powerful members of society. Workers, consumers, farmers, artisans and others found that they could accomplish more by combining their resources and working together.
Cooperative economic development, characterized by the search for means of production and efficient exchanges based on cooperation, is there to improve people’s lives and look after the environment. This is far for being a marginal phenomenon, one in every six people on the planet are cooperators.
Cooperatives can be used to address a multitude of shared needs:
- Producers like farmers, artisans or industrialists utilize the cooperative to market or process their goods jointly.
- Workers in areas as diverse as bicycle sales, baked goods production and catalog sales use cooperatives to create employment that offers many of the benefits of ownership.
- Consumers use cooperatives to gain better prices, gain organic, specialty, or locally sourced food or other goods; acquire financial or insurance services that are focused on member needs rather than profit; bring utility access to remote areas; or meet the social or cultural needs.
- Private business or public entities gain purchasing power through bulk buying, obtaining products or services that are difficult to obtain individually, or sharing administrative cost of certain projects.
- Parents can gain quality childcare, preschool education, charter or private education by working together.
- Home ownership that is affordable or is developed to meet the needs of seniors, students or people with disabilities is created using the cooperative model.
Members are the Cooperative
Each member has one vote in controlling the policies of the business and earnings are based on the amount of trade that each member does at the cooperative rather than the amount of money invested.
Members support the cooperative by doing business with it and remain loyal to it.
Members also support the cooperative by investing in it. It takes money for the cooperative to grow. When members put money into the cooperative they help to build the business and at the same time invest in their own future.
Members support the cooperative by encouraging others to join.
Members support the cooperative by taking an interest in it. Cooperative members should keep themselves informed of the activities and of important decisions that are made.